MTU would fit well says Carlyle

The Carlyle Group’s Edoardo Lanzavecchia has confirmed that the firm is in talks with DaimlerChrysler to acquire its aerospace unit.

Other financial investors reportedly interested in MTU include private equity heavyweights Doughty Hanson, Blackstone Group and Kohlberg Kravis Roberts.

Following the successful completion of negotiations with Fiat to acquire the Italian group’s Avio aerospace unit, Carlyle Group looks set to repeat the trick with a bid for MTU Aero Engines, the aerospace division of German car manufacturer DaimlerChrysler.


Carlyle completed the E1.5bn acquisition of Fiat Avio on Tuesday following three months of exclusive negotiations with Fiat, the struggling Italian car manufacturer. Carlyle took a 70 per cent stake in the business, with Italian industrial giant Finmeccanica taking the remaining 30 per cent.


The deal was led for Carlyle by Edoardo Lanzavecchia, managing director of the firm’s Italian office. Lanzavecchia described the deal as evidence of the firm’s ‘deep aerospace expertise’.


Carlyle is keen to further its involvement in the European aerospace sector with plans to launch an offer for MTU, which is likely to fall in the E1.5bn to E1.8bn price range.


Speaking to German business daily Handelsblatt, Lanzavecchia confirmed that the two firms are in talks about a possible deal. He said that MTU and Avio “have strengths in different products. Therefore, they could complement one another well.”


MTU is one of the few remaining businesses outside of DaimlerChrysler’s car and truck core operations. Based in Munich, MTU reported E2.2bn in sales in 2002 and employs more than 8,000 people.


DaimlerChrysler said it hopes to choose a final bidder for the business by August, providing the group’s asking price is met.